5.3 C
Manchester
December 5, 2022
Image default
Altcoin

Bulls can trigger another rally when Shiba Inu reaches critical support level

With historical data, the Shiba Inu cryptocurrency shows a new high, and can provide considerable gains

Bitcoin has dropped below the $45,800 mark and could fall further south. Shiba Inu reflected the general market sentiment as it also had strong sales in recent days. However, Shiba Inu has reached an area where buyers could potentially be interested.

Will the coming weeks see Shiba Inu consolidate or will the previous downtrend continue once again? Note that SHIB prices are multiplied by 1000 to avoid excessive writing decimals.

SHIBGRA
Source: SHIB / USDT on TradingView

The cyan box represents an area of ​​demand, and the price has already fallen in this area on two occasions before. In October, this $0.027 area acted as a supply zone for SHIB, before sellers ran out and buyers could raise prices another 200%.

Fibonacci retracement levels, based on this breakout, showed the 78.6% retracement level at $0.037, but SHIB was not able to maintain that level in December. The 61.8% to 78.6% retracement area would be where buyers would enter, but in recent weeks there has not been enough demand to halt the decline.

Even if SHIB makes a rally, a close above the latest high of $0.039 is needed to break the bearish structure.

Justification

Trend Shib
Source: SHIB/USDT in TradingView

Indicators have not yet shown the presence of bulls in the market. The A/D line was falling, along with the price, which confirmed the downtrend. As for momentum*, the Awesome Oscillator was moving below the zero line to show bearish momentum.

The Bollinger Bandwidth Indicator was close to where it was in late September when the price was consolidating in the $0.0077 area. This showed that there was a possibility that SHIB was once again building up in an area of ​​historically strong demand.

Conclusion

Shiba Inu was pessimistic on the charts. A risk-averse trader would need to see SHIB rally above $0.037 again and pitch it to support before another upward move. A more risk-seeking investor would look to get some SHIBs at current prices, but trading needs to be managed carefully as a daily close below the demand area could see the SHIB fall further.

*Momentum is an indicator that measures the speed with which prices change when compared to the levels of the current values ​​of a certain asset.

Related posts

Ripple plans aggressive expansion for XRP in 2021

Anupreet Kaur

ChainLink (LINK) resumes $ 12 amid Bitcoin rally

Anupreet Kaur

Price analysis: Bitcoin SV, EOS and FTX Token

Anupreet Kaur

Leave a Comment